A car is considered totally damaged or lost when its estimated repair costs are looking to exceed 75% of its Insured Declared Value (IDV). In that case, under a comprehensive car insurance policy, you are paid as much as the IDV, which is the depreciated value of your car for that year.
You file a claim for total damage with a comprehensive car insurance policy + Return to Invoice Cover
With a Return to Invoice Cover, you can get as much as the on-road price of your car in compensation. On-road price includes the ex-showroom price, registration costs and road tax.
For instance, a Maruti Alto’s ex-showroom price in 2016 may be Rs. 5,25,000, and it’s on-road price can reach up to Rs. 6,00,000 post taxes and registration costs. However, the same car’s IDV in 2018 will be Rs. 4,80,000 after applying standard depreciation. So when you file for a total loss claim... you get the math, right?
Remember: Most insurance companies offer this add-on cover for only cars under 3 years of age.
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